Banks and building societies handed out mortgages to nearly 25 per cent more first-time buyers in March than a year ago, as the deputy governor of the Bank of England played down concerns of a housing bubble.

First-time buyers took out 24,400 loans in March, 24 per cent more than in the same period last year, according to the Council of Mortgage Lenders. The total number of new loans to homeowners for purchases increased by 4 per cent over the same period.

Matthew Pointon, a property economist at Capital Economics, said: “First-time buyers are entering the market by borrowing record